Logitech 2007 Annual Report Download - page 126

LOGITECH INTERNATIONAL S.A.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 — The Company
Logitech International S.A. is a world leader in personal peripherals for personal computers and other digital
platforms, developing and marketing innovative products in PC navigation, Internet communications, digital
music, home-entertainment control, interactive gaming and wireless devices. For the PC, the Company’s
products include mice, trackballs, keyboards, gaming controllers, multimedia speakers, headsets, webcams and
3D control devices. For digital music devices, the Company’s products include speakers and headphones. For
gaming consoles, the Company offers a range of controllers and other accessories. In addition, Logitech offers
wireless music solutions for the home and advanced remote controls for home entertainment systems. The
Company generates revenues from sales of its products to a worldwide network of retail distributors and resellers
and to original equipment manufacturers (“OEMs”). The Company’s sales to its retail channels comprise the
large majority of its revenues.
Logitech was founded in Switzerland in 1981, and in 1988 listed its registered shares in an initial public
offering in Switzerland. In 1997, the Company sold shares in a U.S. initial public offering in the form of
American Depositary Shares (“ADSs”) and listed the ADSs on the Nasdaq Global Select Market. In October
2006, the Company terminated its ADS program, exchanged its Nasdaq-listed ADSs for Logitech shares, and
continued its Nasdaq listing, as a result of which Logitech shares trade on both the Nasdaq Global Select Market
and the SWX Swiss Exchange. The trading symbol for Logitech shares is LOGI on Nasdaq and LOGN on SWX.
The exchange of the Nasdaq-listed ADSs for Logitech shares was a one-for-one exchange and had no impact on
financial statement or per share amounts. The Company’s registered office is located in Apples, Switzerland. The
Company has manufacturing facilities in Asia and offices in major cities in North America, Europe and Asia
Pacific.
Note 2 — Summary of Significant Accounting Policies
Basis of Presentation
The consolidated financial statements include the accounts of Logitech and its subsidiaries. All
intercompany balances and transactions have been eliminated. The consolidated financial statements are
presented in accordance with accounting principles generally accepted in the United States of America (“U.S.
GAAP”) and comply with Swiss law. In the opinion of management, these financial statements include all
adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the results for the
periods presented. Certain prior year financial statement amounts have been reclassified to conform to the current
year presentation with no impact on previously reported net income.
Fiscal Year
The Company’s fiscal year ends on March 31. Interim quarters are thirteen-week periods, each ending on a
Friday. For purposes of presentation, the Company has indicated its quarterly periods as ending on the month
end.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make
judgments, estimates and assumptions that affect reported amounts of assets, liabilities, net sales and expenses,
and the disclosure of contingent assets and liabilities. Although these estimates are based on management’s best
knowledge of current events and actions that may impact the Company in the future, actual results could differ
from those estimates.
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